Do I need help with my tax return or are they easy?

[AliciaWhiskers]

I have a main job that is PAYE. I have also registered as self employed as I earn money from some other work from home jobs. And last year I also earned some money in interest from a bank account after an inheritance.

Are tax returns easy enough to do myself, or do I need someone else to have a look at it for me? My OH has suggested I ask his accountant to look at it but I don't know if I need to pay someone else to look through it for me.

Depends, my accountant costs are what I can earn in a day, and it would take me longer than a day to get my head round it so not worth my while. I also a part time paye job which makes it a bit more complicated. Plus accountant knows better than me about the rules around expenses/ mileage etc.

I thought you didn't get tax relief unless you were VAT registered?
I'm newly sef employed so know very little.

I always seem to build it up in my head to be really complicated and when I actually sit down to do it it’ll take only a couple of hours. There are really simple guidance notes & worksheets for anything out of the ordinary. Give it a go with ample time before next year so you can speak to a professional just in case you need help...

If you do pay an accountant you will have the peace of mind of knowing it has been done correctlý.

Financially it could be worth using an accountant for the first year so you know for the future what expenses can be offset against income. You could well cover all professional fees this year with tax savings and make the same savings yourself in the future. If you've only ever been PAYE it's a whole new world of claimable expenses.

What Mencken means about the pension is this I suspect:

If your PAYE job pays less than £6,240 pa (the current lower earnings limit for NI) then you will not get pension credits that year.

NB if you have a child under 12 and you are registered for child benefit for that child you get pension credits anyway.

So if you earn over £6,240 in the PAYE job and/or get child benefit for a child under 12 you don’t need to worry about the next bit.

If you earn below the NI threshold in your PAYE job and don’t have a child under 12, you can get pension credits via Class 2 NI payments in connection with your self employment. You have to pay Class 2 NI if your profits from self employment are more than £6,240. However if your profits are less than this amount you can opt to pay Class 2 voluntarily, and get a year’s worth of credits. Class 2 is about £150 for a year, so it’s worth doing if you fall between the cracks.

NB I can’t remember if each type of self employment is considered separately for these purposes-you’d have to check, as you say you have the ironing and another business as well.

People are dismissive of what an accountant does.

If yours is very very simple then I'm sure you can do it yourself.

I do them for others and find them easy, but not everyone's is simplistic.

but unless you pay very big sums they still ask you to collect all the info
Of course they will. Accountants aren't psychic mind-readers!!

Hoe much was your self employed income?

Under £1000 and you dont have to complete a return. If you have one you can call HMRC and get it quoshed.

If its more you can claim expenses or knock £1000 off instead (called a trading allowance). Again this makes completing your return easier.

We dont change much for completing simple returns, about £150-£180. As well as competion and submission, we also give advice on tax payments due dates and expenses claims. In the current environment we have called every single client, irrespective of fee size, to discuss their position in relation to COVID government provisions and make sure they are accessing whats available to them. In more normal times, clients call with general questions.

I would say its that support service that makes using an accountant worthwhile even with a small return. Not all offer this type of service though.

thanks @howells, that is what I was thinking of.

I'm not suggesting accountants are the equivalent of beauty consultants or handbag designers - MN oversensitivity again! It's just that for those of us doing tax returns but with an income of around £10k, it really isn't cost effective to employ an accountant. All the guidance and info is online and I don't earn enough to make it worth paying someone else.

@FTMF30 you can get tax relief on business expenses without being VAT registered. So I can claim on specialised clothes or tools for my work, or travel, for example. It has to be wholly and entirely for the purposes of your work (you can't buy a new pair of jeans that you might wear at work and also at home, and claim for those), and you can't take the piss - you can't earn £50k and claim business expenses of £30k - that's asking to be investigated

@MusicianTom Oh right. Good to know. Thank you!

Hi all, you were so helpful before I was hoping to pick some brains again! I'm in the process of trying to fill in the tax return but have come across a stumbling block. I do online work for various organisations - there is no contract but they offer work, I do it, and they pay me. Do I have to list each organisation separately, or do I just put it all under self employed work? TIA!